Doha, Qatar: The first six months of the year saw a noteworthy boost in the residential supply from developments specifically for the 2022 FIFA World Cup fans in Qatar, reported global research consultancy group, Knight Frank.
At present these properties are released to the market and eventually, the rental rates for the apartments and villas have come down, stated the group.
According to the market researchers, rents plunged in most of the districts, however, the Waterfront and Fox Hills, both in Lusail, experienced the highest quarterly depreciation of 23 percent and 18 percent, respectively, among the average quoted rents for apartments.
The report highlighted that the gross yield for single-let residential properties in Qatar averaged 5 percent during the second quarter of the year, which indicates a decrease of 9 percent compared to the last quarter of 2022.
The report mentions that currently, apartments across the country have a higher gross yield of 6.2 percent, while villa yields stand at 3.5 percent.
The report notes that “The housing market in Qatar faces challenges as demand weakens against growing supply glut stemming from the construction boom in the lead up to the 2022 FIFA World Cup. This supply and demand imbalance, coupled with rising interest rates, which are fuelling affordability challenges, are together contributing to a shrinking mortgage market, while at the same time, the number of home sales is declining.”
The second quarter of the year also witnessed a total number of residential sales transactions declining by 36 percent over the 12 months. Meanwhile, the value of residential transactions dropped by 24 percent over the same period.
During the past one year, the villa sales price fell by 3 percent and stood at QR7,130 psm.
The average transacted price for apartments, however dropped by 2 percent over the last 12-months to QR13,750 p sm, the report depicted.
Knight Frank’s data reveals that Doha municipality, with 185 sales, and Al Rayyan municipality, with 182 deals recorded the highest volume of residential transactions in Q2 2023.
“Findings from our 2023 Destination Qatar report, which analyses results of a survey of Qatari High Net Worth Individuals (HNWI) show that Lusail is the most preferred residential investment target, with an average budget of $1.8m, the report added.
However, among them, 71 percent already own a home in Lusail, with Lusail Marina and Lusail Waterfront identified as the two most favored locations for a residential real estate acquisition.
